Table of Contents

Table of Contents........................................................................................................................1 Synopsis......................................................................................................................................3 1 Introduction.............................................................................................................................4 1.1 Central background Introduction................................................................................4 1.2 Company background...................................................................................................6 1.2.1 Organization Structure...............................................................................................7 1.2.2 Distribution Network.................................................................................................7 1.2.3 Company Vision........................................................................................................8 1.2.4 Company Mission......................................................................................................8 1.2.5 Company Values........................................................................................................8 1.2.6 Company Goals.........................................................................................................8 1.2.7 Company Principles...................................................................................................8 1.2.8 Corporate Social Responsibility..............................................................................11 1.2.9 Business Process Re-engineering............................................................................12 1.2.10 Environment, Health & Safety (EH&S)................................................................12 2 Company Analysis.................................................................................................................14 2.1 Business Performance..................................................................................................14 2.1.1 Sales Performance...................................................................................................14 2.1.2 Contribution to the National Exchequer..................................................................14 2.1.3 Operating and other cost..........................................................................................14 2.1.4 Cash flows...............................................................................................................15 2.2 Financial Analysis........................................................................................................15 2.2.1 Ratio Analysis .........................................................................................................15 2.3 Human resource Analysis............................................................................................19 2.3.1 Classification of workers ........................................................................................20 2.3.2 Areas Covered by HR department .........................................................................21 2.3.3 Mutual Industrial issues...........................................................................................22 2.3.4 Retirement...............................................................................................................23 2.4 Marketing Analysis ....................................................................................................23 2.4.1 SWOT Analysis.......................................................................................................24 3 Environmental Analysis........................................................................................................26 3.1 Industry and Market Analysis....................................................................................26 3.1.1 Product line of PTC ................................................................................................26 3.1.2 Growth rate of entire industry.................................................................................27 3.2 Competitor analysis.....................................................................................................28 3.2.1 Major Competitors...................................................................................................28 3.2.2 Market Shares: ........................................................................................................29 3.2.3 Goals........................................................................................................................29 3.2.4 Competitive Strategies.............................................................................................29 Trade Marketing and Distribution Structure............................................................................30 Distribution in Islamabad.........................................................................................................31 Islamabad Market..............................................................................................................31 Distribution Chart..............................................................................................................32 Distributor Operations......................................................................................................32 Page | 1

Sales.......................................................................................................................33 Operations...........................................................................................................................34 4 Task 1....................................................................................................................................38 4.1 Role profile of the FSO................................................................................................38 4.1.1 Introduction.............................................................................................................38 4.1.2 Findings...................................................................................................................39 4.1.3 Recommendations...................................................................................................40 4.1.4 Conclusion...............................................................................................................41 4.1.5 Results.....................................................................................................................41 4.2 Salesmen beat revision.................................................................................................42 4.2.1 Introduction.............................................................................................................42 4.2.1.1 Results..................................................................................................................42 4.2.2 DSR Problems ........................................................................................................42 4.2.3 Solution....................................................................................................................42 4.2.4 Beat updating...........................................................................................................43 4.3 RCS updating...............................................................................................................43 4.3.1 Result.......................................................................................................................43 4.4 Key accounts Management..........................................................................................44 Appendix..................................................................................................................................45

Page | 2

Synopsis
One can learn through different ways. But to get the first hand knowledge, one should put itself in practical and natural environment. This is the utmost purpose of internship, which we supposed to do for at least six to eight weeks. This summary is written to discuss in detail the Steps to improve the Distribution in Islamabad. In this report I have addressed the problems at the distributor shop. In the very beginning of this report I have defined the company history and distribution in Islamabad follow with distributors operation. I have also written about the facts (findings) which I have gathered and then I have given the recommendations in second phase Role profile of FSO is defined with its main points and result and new Role profile is also attached with it. In the third phase of this report I have discussed the problem of salesmen route plan and its solution, format of DSR and RCS up dating and Last but not least Key accounts Record retention.

Page | 3

1 Introduction
1.1 Central background Introduction
Pakistans tobacco industry has been a traditionally dependable source of government revenue, contributing around Rs27.5 billion per year the equivalent of 4.4% of Pakistans GDP. It has the largest yield of any crop and employs some 1 million people. It was recently announced that Philip Morris acquired Lakson Tobacco, the second largest tobacco manufacturer in Pakistan. Philip Morris already owned 47% of Laksons stock, and then bought another 50%. Lakson Tobacco is valued at Rs41.07 billion ($674.9 million). Lets see how the world tobacco leader tries to lure our gullible leaders. Pakistan is one of 146 countries that have ratified the global tobacco treaty, and in doing so has taken a great step forward in protecting the health and lives of its citizens from the tobacco epidemic. Formally known as the World Health Organization (WHO) Framework Convention on Tobacco Control (FCTC), the treaty aims to reverse the tobacco epidemic by changing the way tobacco corporations operate around the world. Pakistan banned indoor public smoking and all tobacco advertising in 2002. It is illegal to sell tobacco products to anyone under the age of 18 or within 50 meters of a school. Smokers who violate this law are fined heavily. Even more interesting, advertisers and sellers of tobacco who are found to violate these laws can go to prison. This is what appears on paper; in reality, the prime minister of the country is seen encouraging a tobacco company and helping to bolster its image. A colour advertisement displaying logos of the Government of Pakistan (GoP) and Pakistan Tobacco Company (PTC) was published in newspapers to announce the foundation stonelaying ceremony of Ghourghushti Environment Park in Attock district. This park is a collaborative effort of PTC and the GoP. In April 2007, the prime minister laid the foundation stone. Corporations like PTC (a subsidiary of British American Tobacco) and Lakson (now almost totally owned by Philip Morris/Altria) have attempted to interfere with the implementation and enforcement of the global tobacco treaty in Pakistan. These corporations use their tremendous political influence to weaken, delay and defeat tobacco control legislation around the world. Page | 4

Profit margins for the two Pakistani tobacco giants remain very high and they pay relatively high taxes compared to businesses of similar size, which makes them popular in the finance and tax departments. These departments, like the prime minster, fail to measure the losses incurred by tobacco usage all around. The tax collected is very small compared to the expenditure incurred by the state to treat tobacco-related diseases. Even when people realize the adverse effects of tobacco, the addiction is so strong that it is nearly impossible to give it up. They, who have been lured into this folly by slick advertising from tobacco companies fully aware of the nature of the addiction, are victims of duplicity by the death peddlers. However much money these companies may fill our coffers with, some truths just cannot be denied. They are a net loss to the exchequer if all the losses are factored in. But the most powerful argument against these American and British companies is that they kill an awful lot more Pakistanis than the Taliban and Al Qaeda will ever destroy in our countries and elsewhere, including the home bases of these companies. The company prides itself in being the first multi-national company to begin its operations in Pakistan. Our parent company, British American Tobacco has been in business for over 100 years now with a presence in over 180 countries. The Group has built an international reputation for making and marketing high quality brands for the millions of informed adults who choose to consume tobacco. From being just a single factory operation to a company which is involved in every aspect of cigarette production, from crop to consumer, we have evolved into one of the leading corporations in Pakistan. PTC run two state of the art factories and employ more than 1,700 people while indirectly providing livelihoods to more than a million people who are involved in various aspects of the business. PTC is market leaders and contributes more than Rs. 30 billion in excise duties and taxes to the Government. Their strategy reflects their vision, being the champions of growth, productivity, responsibility and a winning organization. Their brands encompass their values and boast a diversified portfolio catering to the different tastes and preferences of the entire tobacco market. By offering products that are superior in quality, driven by global standards, they meet and exceed the expectations of their consumers.

Page | 5

1.2 Company background

Pakistan Tobacco Company Limited was incorporated in 1947 immediately after partition, when it took over the business of the Imperial Tobacco Company of India which had been operational in the subcontinent since 1905. From being just a single factory operation to a company which is now involved in every aspect of cigarette production, from crop to consumer, PTC have evolved and grown with Pakistan. However, what is significant about these 62 years is the effort that Pakistan Tobacco Company has demonstrated in the development of the country. By being instrumental in the campaign for modern agricultural and industrial practices, PTC have helped in the development and progress of the agricultural and industrial sector in the country. PTC have been supporting and contributing to various causes of national interest. Educating growers in the latest techniques and technology in agriculture, a forestation and free health care in designated areas are but a few examples. Throughout these 62 years, they continuous investment in people, brands, technology, innovation and the communities in which they operate has borne fruit in many ways. They are deemed as a partner of choice by many, our Environmental, Health and Safety standards are a source of inspiration for local companies, their industrial relations practices have led and influenced local practices, and as a result of all these, our managers are highly valued and sought after people in the Pakistani corporate world based on the training and exposure PTC give them from very early on in their careers. Suffice it to say that the history of the Pakistan Tobacco Company is closely linked with the development and history of the areas in which they operate. Be it corporate practices, social investments, advancements in agricultural techniques, or establishing new ways of marketing and distribution, PTC have always been instrumental in establishing the benchmarks against which others are measured. PTC, as a company, work towards broader goals beyond the benefit of the shareholders and demonstrate support for communities, high standards of ethical behavior and greater transparency and accountability. They are committed to continuous improvement and to keeping an open mind. They have learnt that companies can rarely act alone; almost all our contributions to society involve working constructively with others and by engaging and Page | 6

listening to their stakeholders. By matching their words with their actions, they aim to demonstrate the behavior of a responsive and responsible tobacco company.

1.2.1 Organization Structure

Pakistan Tobacco Company (PTC) is a member of British American Tobacco (BAT) group.BAT holds 64% shares in PTC and was the first (MNC) Multinational Company to introduce tobacco business in Pakistan. At the top of the organization hierarchy is the Chairman of PTC. Below the Chairman is a Managing Director. Below the MD are 6 Directors of the respective departments. First of all the most important aspect in a Company is its organizational setup. There are 4 regions in Pakistan for Pakistan Tobacco Company.

1.2.2 Distribution Network

Regions Areas Warehouses Distribution centers

4 18 20 381

Regions

The Central Region

The North Region

Sind and Balochistan

The Southern Region

These regions are further subdivided into areas according to the geographical location. Every area office gets its instructions from the regions and then makes out the plans for their respective territory. They work in close liaison with the regions so that they can keep company planners informed about the company's potential market expectations. Page | 7

1.2.3 Company Vision

FIRST CHOICE OF EVERYONE To become the preferred choice for everyone and achieve recognized market leadership through sustainable world class performance in all aspects of the business.

1.2.4 Company Mission

Transform PTC to perform with speed, flexibility and enterprising spirit of innovation, consumer focused company.

1.2.5 Company Values

To think and operate as one company. To satisfy customers better than competitors. To encourage decision making as close to end market as possible. To be committed to achieve the desired result. To trust each other. To value breakthrough thinking and calculated risk. To care deeply about developing own people. Be demanding but fair employee. To be a cooperative citizen. Enjoy ourselves.

1.2.6 Company Goals

PTC's goals are not only to continue creating long-term, sustainable shareholder value, but also to lead the tobacco industry in demonstrating corporate social responsibility and wider accountability. PTC aims to grow considerably by successfully pursuing its strategy of organic growth and investment in new markets and acquisition.

1.2.7 Company Principles

Pakistan Tobacco Company is a commercial enterprise and our primary role is to build long term shareholder value by meeting consumers preferences for high-quality tobacco products. However, we believe that by absorbing and balancing a wider range of expectations, we are best placed to continue building a sustainable tobacco business.

Page | 8

Like other multinational enterprises benefiting from economic globalization, British American Tobacco also faces increasing demands to be more transparent and to demonstrate high standards of corporate conduct that might in the past have been taken on trust. In todays rapidly changing world, large and successful businesses can be perceived as powerful and self-interested and can face barriers to trust. As a tobacco business, the Group can face more than others. In addressing these, a further challenge is that major enterprises like British American Tobacco often encounter varying and at times conflicting stakeholder expectations in different countries and cultures. To help meet these challenges and following on a commitment made in the first British American Tobacco p.l.c. Social Report 2001/02, the Group has developed these Business Principles in consultation with managers from their businesses, as well as with external stakeholders. The Business Principles and Core Beliefs cover the key issues that underpin Corporate Social Responsibility (CSR) for a multinational business and, particularly, given the unique characteristics of a tobacco business. There are three Business Principles: Mutual Benefit, Responsible Product Stewardship and Good Corporate Conduct, each of which is supported by a number of Core Beliefs, which explain what they think the principle means in more detail. Together, these form the basis on which they run our business in terms of responsibility. Both the Business Principles and Core Beliefs and the way they have been developed are consistent with our four Guiding Principles, which collectively express the culture of the Group and Pakistan Tobacco Company as part of it. The four Guiding Principles are:

Strength from Diversity Open Minded Freedom through Responsibility; and Enterprising Spirit

1.2.7.1 Mutual Benefit The principle of Mutual Benefit is the basis on which they build their relationships with stakeholders. They are primarily in business to build long term shareholder value and they Page | 9

believe the best way to do this is to seek to understand and take account of the needs of all our stakeholders.

Core Beliefs

PTC believes in creating long term shareholder value. PTC believes in engaging constructively with our stakeholders. PTC believes in creating inspiring working environments for our people. PTC believes in adding value to the communities in which we operate. PTC believes that suppliers and other business partners should have the opportunity to benefit from their relationship with us.

1.2.7.2 Responsible Product Stewardship The principle of Responsible Product Stewardship is the basis on which PTC meet consumer demand for a legal product that is a cause of serious diseases. Therefore, their products and brands should be developed, manufactured and marketed in a responsible manner. PTC also aspire to develop tobacco products with critical mass appeal that will, over time, be recognized by scientific and regulatory authorities as posing substantially reduced risks to health. Core Beliefs

PTC believes in the provision of accurate, clear health messages about the risks of tobacco consumption.

PTC believes the health impact of tobacco consumption should be reduced whilst respecting the right of informed adults to choose the products they prefer.

PTC believes that relevant and meaningful information about our products should continue to be available.

PTC believes that underage people should not consume tobacco products. PTC believes that our brands and products should be marketed responsibly and directed at adult consumers.

Page | 10

PTC believes in the appropriate taxation of tobacco products and the elimination of illicit trade.

PTC believes in regulation that balances the interests of all sections of society, including tobacco consumers and the tobacco industry.

PTC believes that public smoking should be approached in a way that balances the interests of smokers and non-smokers.

1.2.7.3 Good Corporate Conduct The principle of Good Corporate Conduct is the basis on which their business is managed. Business success brings with it an obligation for high standards of behavior and integrity in everything they do and wherever they operate. These standards should not be compromised for the sake of results. Core Beliefs

PTC believes our businesses should uphold high standards of behavior and integrity. PTC believes that high standards of corporate social responsibility should be promoted within the tobacco industry.

PTC believes that universally recognized fundamental human rights should be respected.

PTC believes the tobacco industry should have a voice in the formation of government policies affecting it.

PTC believes in achieving world class standards of environmental performance.

1.2.8 Corporate Social Responsibility

At Pakistan Tobacco Company we aim to demonstrate responsible corporate conduct across all aspects of our operations. PTC is abide by this philosophy each step of the way: from appropriate marketing and consumer information to supporting sensible tobacco regulation; from respecting workplace human rights and reducing our environmental impact to contributing to local communities. They seek to work continuously to engage with our stakeholders, to balance their views and Page | 11

to align our business decision-making with the reasonable societal expectations of a modern tobacco company. PTC recognizes that Corporate Social Responsibility (CSR) presents particular challenges for a tobacco company. Tobacco products pose real risks to health and raise important questions about how best to define responsible product stewardship. They, therefore, believe that for their business, the only meaningful approach to CSR is one based squarely on our products, on the issues around them and on ways of responding to the sometimes strongly held views of their stakeholders. PTC hope that more corporations include CSR in their strategic planning processes and understand that their businesses provoke a social cost which has to be balanced by keeping in mind the interests of all the stakeholders and communities involved.

1.2.9 Business Process Re-engineering

Appreciating the importance to change the status quo for continuous improvement and deliver strong business results in a sustainable way, PTC has always been on the lookout for opportunities to enhance the speed, efficiency and reliability of PTCs Process. Several BPR projects were undertaken during 2006 and 2007 including the setting up of the Enterprise Programme Office (EPO), project slender at Akora Khattak Factory and the supply chain Operations References (SCOR) Model implementation. EPO puts in Place a new way working, which keeps corporate strategy at the forefront and ensure that all the initiatives are aligned to support the strategy though effective programme management and allocates resources to the best fit priority areas. Project slender entails relocation of the machinery and resources, changing the layout of production floor in a way to boost process efficiencies and achieve higher productivity without employing additional resources. SCOR model is being implemented all across the supply chain i.e. from seed to smoke, for achieving cost optimization and improved process efficiencies.

1.2.10 Environment, Health & Safety (EH&S)

Being fully alive to its role as a responsible corporate citizen PTC has implemented a well structured EH&S programme in addition to embedding internationally recognized best Page | 12

practices. PTC is committed to ensure that it nurture an environment where its employees and surrounding communities are safe from any hazards that may affect their health and minimize the impact of its operation on biodiversity. PTCs commitment to EH&S was further strengthened during 2006 as PTC achieved significant improvements on the EH&S road map. Both its production facilities were rectified with ISO 14001 earning the Evergreen status. PTC has consistently sustained its accreditation in last seven surveillance audits with zero major and minor points. PTCs efforts has further been sustained with National Forum for Environment & Health awarding PTC the Annual Environment Excellence award on Health, Safety and Environment for second consecutive year in 2006. Through out the companys history, it has maintained a strong stance on corporate and social responsibility, it strongly believes in building effective and constructive partnership with communities by helping address various EH&S issues. Over the years the company has invested substantial resources in terms of finances and manpower in various initiatives like Mobile Free Dispensaries, Learning Resource Centre and Portable Water.

Page | 13

2 Company Analysis
2.1 Business Performance
2.1.1 Sales Performance
The company delivered a record sales volume of 41.5 billion cigarette sticks, registering a 12 % growth in terms of volume and 20% in terms of value over the previous year. Financial highlights Total Market In billion (Rs) 2007 Gross turnover 40889 Gross profit 6516 Operating profit 3984 Profit before tax 3725 Profit after tax 2420 EPS (Rs) 9.47 Increase 2008 49054 7277 4415 3894 2532 9.91 20% 12% 11% 5% 5% 5%

PTC has shown remarkable resilience in 2008. While it witnessed very testing times, it has emerged even stronger. In depth understanding of consumer needs, focus on product quality and innovative marketing campaigns have always been their forte and they provide them a strong organic growth even in difficult times.

2.1.2 Contribution to the National Exchequer

The benefits of increased growth and profitability of our operations also accrued to the Government in terms of higher tax payment. The company paid a total of Rs. 32 billion in 2008 comprising of federal excise duty, sales tax custom duties and income tax an increased of 20% over last year.

2.1.3 Operating and other cost

The company made considerable strides in its endeavors to establish and promote a cost conscious culture in all facets of the business. With only 8% increase in the marketing expenses, which is much lower then inflation, company managed to grow sales by 12% in an increasingly competitive. Page | 14

2.1.4 Cash flows

Volume growth during the year resulted in significant increase in operating cash flows. This was partially off set by higher dividend payments and higher investment in pant and equipment. However, the year witnessed a net increase in cash amounting to Rs. 369 million for the company.

2.2 Financial Analysis

2.2.1 Ratio Analysis
2.2.1.1 Liquidity ratios Current Ratio (current Assets / current liabilities)

2005 1.1

2006
1.1

2007
.96

2008
.91

There is slight decrease in the current ratio but this ratio is acceptable for the creditors because the standard ratio for any efficient firm is 1. Ratio figure has decreased because both current assets and the current liabilities have increased accordingly which has balanced out the ratio to the same level. Firm is still able to pay its short term payables. Quick Ratio (current Assets - inventory / current liabilities) 2005 ----2006
.10

2007
.13

2008
.15

Quick ratio in 2008 has increased due to decrease in inventory which shows that the inventory in 2008 was not the major part of the assets. Whereas in 2007 inventory was high in ratio. The increase in firm quick ratio is a good sign for the firm. Firm is now much able to pay the short term liabilities through its most liquid assets. Cash Ratio (cash / current liabilities) Page | 15

2005 -----

2006
0.016

2007
0.034

2008
0.054

In 2008 the cash and bank balances of company is increased from 0.034 to 0.054 that shows that company has increased its liabilities through short term loans and financing ,where as the inventory in 2008 has been increased for the purpose of sales. Creditors are very much interested in cash ratio. The figure has increased but not so much, It has increased because cash and bank balance has increased but at the same time the current liabilities has also increased accordingly. Current liabilities have increased because trade and other payables has increased which means they purchased inventory on credit.

2.2.1.2 Long term Solvency Measures Total Debt Ratio (Total Assets -Total equity / Total Assets) 2005 ---2006
0.67

2007
0.72

2008
0.79

The ratio has increased in 2008 from 0.72 to 0.79This increase is due to increase in both the short term and long term liabilities. Debt-Equity Ratio (Total Debt / Total Equity) 2005 0.5 2006
0.3

2007
0.28

2008
0.16

The ratio has decreased due to the increase in debt and decreased in equity. The debt has also increased as the firm has financed its operation from the banks loan and less dependent on shareholders. It shows that most of the firms financing is provided by debt not by shareholders. Interest Coverage Ratio (EBIT / Interest) 2005 ----2006
57.03

2007
75.02

2008
74.02

Page | 16

This ratio determines the firms ability to pay its interest obligations. The interest coverage ratio in 2008 has decreased to 75.082to 74.02 times. As the ratio has decreased its a unfavorable sign for the firm. Previously firm was in better position to pay its interest liabilities .As the firm is meeting the standard of 3, the credibility of the firm is high and investor would invest in the company. This ratio determines the firms ability to pay its interest obligations.

2.2.1.3 Assets Management / turnover Measures Inventory Turnover (Cost of good sold / Inventory) 2005 6.1 2006
6.7

2007
2.38

2008
2.85

The ratio in 2008 has increased a little from 2.38 times to 2.85 times. The increase in ratio is due to a decrease in inventory which has lowered the cost of goods sold. As this there is a slight increase in value, the firm has a good effect towards the liquidity. Days sales in inventory (365 / ITR) 2005 59.83 2006
54.47

2007
153.36

2008
128.07

The inventory turnover in days has decreased from 153.36 to 128.07 in 2008 which is a good sign for the firm. The decrease is of almost 7 days. This decrease is suitable for the firm as it can spoil the inventory by keeping it in hand. ITR = Inventory Turnover Ratio Total Assets Turnover (Sales / Total Assets) 2005 3.8 2006
4.2

2007
4.2

2008
4.72

Page | 17

This ratio has increased because of high level of increase in sales in relation to assets. There is a decrease in denominator due to which ratio is higher. This shows that company is efficient in using its assets to generate sales.

2.2.1.4 Profitability Measures Net profit Margin (Net income / Sales)*100 2005 -------2006
9.50

2007
10.50

2008
9.26

This ratio has decreased which shows that company is in unfavorable position. Return on Assets (Net income / Total assets) 2005 -------2006
0.218

2007
0.245

2008
0.272

There is an increase in ratio in 2008 that shows that the firm has managed its resources efficiently and effectively. Firm has increased its assets in 2008. . Return on Equity (Net income / Total Equity) 2005 30.3 2006
38.2

2007
48.37

2008
48.84

There is increase in ratio of return on equity this increase in ratio in 2008 shows that the common stockholders are now earning 48.84% on common stock equity, which was previously 38.2%. This increase in value is due to increase in net income as well as sales. The value of earning per share has also increased in 2008.

2.2.1.5 Market Ratios Page | 18

Earning Per share (Net income / *Shares outstanding) 2005 5.17 2006
7.46

2007
9.47

2008
9.91

The earning on share is increased in 2008 from 9.47 to 9.91 because the net income is increased. This increased in earning on share has also in creased the return on common equity. The firm is earning Rs.9.91 on behalf of each share. This decrease in earning per share would positively affect the trust of the investors towards the firm and would build the repute of the company. Price - Earning Ratio (Price per share / Earning per share) 2005 13.33 2006
9.66

2007
16.42

2008
10.73

Price earning ratio has decreased which means investors are now wiling to pay Rs 10.73 on each Rupee of earning, which shows that investors trust have decreased and they are less willing to pay because of economic recession.

2.3 Human resource Analysis

Every organization is comprised of people. Acquiring their services, developing their skills, motivating them to high levels of performance, and ensuring that they continue to maintain their commitment to the organization are essential to achieving organizational goals and objectives. Human Resources Department is the part of the organization that is concerned with the people dimension. It is a staff or support function in the organization. Its role is to provide assistance in HR matters to line employees or those directly involved in producing Page | 19

organization goods and services. The main functions of HRD are to resolve the workers grievances and care of disciplinary procedures, misconduct, faults and omissions. The HR department provides an opportunity for the employee and performance manager to discuss development goals and jointly create a plan for achieving those goals. Development plans should contribute to organizational goals and the professional growth of the employee. Core Function of HRD Industrial Relationship Recruitment Selection Training & development Placing Promotion Transfer Salary statement Agreement with Collective Bargaining Agents Occupational health program Legal affairs

2.3.1 Classification of workers

The workers employed in PTC are classified into two categories: Permanent or non- seasonal workers. Temporary or seasonal workers.

2.3.1.1 Permanent Workers Permanent workers are hired by HRD. The factory employs them directly on permanent basis. Therefore, they are required to meet all the requirements that the company has established for a worker. New workers when hired are properly trained and closely watched at work during the early period of their job.

2.3.1.2 Temporary Workers Page | 20

The temporary workers are hired by HRD as seasonal workers. They are on the job for six months in a year i.e. from July to December now this period has declined to only 3 months. . At depots they are hired for buying tobacco and doing other jobs in the Leaf areas. At factory they are hired normally for GLT services. If a temporary worker works for the whole season, he gets the benefit of special bonus. If he remains absent for 10 consecutive days, another worker for the rest of the season replaces him. If a seasonal worker remains absent for three consecutive seasons, his license is cancelled. The wage level and terms and conditions for the temporary workers are nearly the same as that of permanent workers.

2.3.2 Areas Covered by HR department

2.3.2.1 Recruitment Recruitment is mainly concerned with securing the potential candidates. It is the process of contacting the public and encouraging suitable candidates to come forward for final selection. Organizations succeed largely through the efforts of the individuals working with in them. It follows that hiring the right individuals is of fundamental importance and a cornerstone of good management. The consequences of good selection are often clear, whereas those of poor selection are not always obvious. The cost of advertising, the management time involved in selection and training, and the expense of dismissal are easy to calculate, but the longerterm effects such as lowering of morale, reduced business opportunities and reduced quality of product or service are possibly more serious. In PTC for recruitment, first of all there is a requisition from a department for a post which if approved by the HRD and then advertised by the head office. Thereafter there is a shortlisting from a pool of candidates. The remaining candidates undergo tests and interviews, after which there is a call, a medical test and at the end the best candidate is selected. FROM WITH IN THE INDUSTRY Employee Referrals Advertising Employment Agencies

2.3.2.2 Selection Preliminary Selection Page | 21

Filling Up The Application Form Wide Range Interview Employment Proffer

2.3.2.3 Training and development An employee is trained in accordance with the needs of the concerned department. The HRD specifies needs of training and arranges courses, which can be carried out in the country or abroad also. The annual report of the employee includes the courses he/she has received. The courses include office management, communications, etc. Other thing is the employee development. The difference between the employee training and development is that, that training is present oriented activity while development is future oriented. Employee development helps the employees and enables them to cope the future challenges and perform the activities in the coming future.

2.3.2.4 Promotion The employees having a good performance are promoted to next higher post there are two factors for promotions service/seniority, which is the time that employee has spent the organization. Performance, which is based on workability, efficiency of an employee, certain jobs require special training while some not. In case of workers annual assessments from is field in service record at the beginning of every year. Line managers do their assessments, their immediate bosses. That is from January to December having remarks of unit manager, sign of in charge of department, marks according to percentage point system. In production upgrading is easy, group operator to machine controller.

2.3.3 Mutual Industrial issues

Steadfast singing of documents without writing them. Illegal strike Stoppage of work. Wages, rent, allowance. Meal regulation. Special attendance allowance. Hajj allowance. Page | 22

Leaves. Financial assistance. Basic pay increase.

2.3.4 Retirement
There is a limit in individual life for doing a job. No individual can work throughout his life therefore every one. In PTC the age of compulsory retirement is 58 years for workers and managers, first extension is given at the age of fifty-five years, second at 56, third at 57, subjected to his performance and medical fitness. The retirement can also be on medical board examination/ recommendation basis.

2.4 Marketing Analysis

Marketing at PTC is divided into three further categories: marketing research, brand marketing and trade marketing the marketing research department carries out its surveys and other such activities to find out the demand for each brand, and to discover the potential cigarette market. The brand-marketing department comprise of brand managers who have the responsibility for success and health of their individual brands. Each brand manager designs and executes promotions to increase the sale of his brand. Advertising through different medias and sponsorships of event is also the job of brand marketing. The trade marketing staff works direct in the field and interacts with the distributors, wholesalers, retailers, and the customers. PTC has been consistently meeting consumer expectations for the past ten years with the popular international brand names like Benson and Hedges, John Players Gold Leaf, Wills, Capstan, and Embassy which is the largest selling brand in the market. PTC, through 343 distributors, services a very large retail and wholesale network across the country. PTC has always been looked upon as one of the most dynamic organizations with its exuberance to quickly adapt to the changing needs of the market. PTC has also been a harbinger in establishing scientific methods of marketing research to focus on the changing consumer requirements. As part of this tradition, the company recently conducted a detailed urban and rural retailer census, a gigantic task never undertaken by any business outfit in Pakistan. The census facilitated in determining the volume of business, region wise requirements/demands and also helped in streamlining PTCs current distribution network thereby reducing costs. Total of about 270,000 retailers and over 7000 wholesalers were surveyed. PTC is also a Page | 23

pioneer in introducing filter cigarettes in Pakistan as early as 1955. More recently, keeping in view the shift towards light, gold leaf lights has been introduced in the market representing the house of gold leaf as a truly international offer keeping with the times and remaining in tune with the changing needs, and tastes of PTCs consumers. In keeping up with its tradition of being in the cutting edge of marketing innovation, PTC co-sponsored the launch of the epic movie Titanic in Pakistan, thereby setting a singular precedent of providing quality entertainment to the nation. And this was within three months after the Explore the World promotion campaign for Gold Leaf was ran, to which PTC received in excess of 1500, 000 consumer entries. PTC is constantly endeavoring to introduce novel and innovative measures to further the marketing graph and offset the extraneous adverse affects. PTC is one of a very few companies in Pakistan which is paying a great deal of attention to the retail marketing. It started a retail excellence program, which is a set of structured presentations covering subjects such as business ethics, trends, customer focus and how to satisfy customer needs profitably. It enables PTC to develop and roll out best-practiced retailer methods, which will enhance retailer profitability and their relationship with the company in order to regain market leadership in the future. The focus is how to provide a world-class service to consumers, sharing company information and plans, and gaining feedback. PTC holds numerous trade meetings with its distributors and retailers, which no doubt helps to strengthen the relationship and be responsive to their requirements better than any other FMCG company in the market place. These meetings are held at high quality venues and a gift from PTC is given to each retailer as a token of appreciation for their attendance. This is a unique concept in the market as PTC is the only comp- any in Pakistan to embark on such a program for retailers working in line with the companys vision to be first choice for everyone. The intention is to transform PTCs field staff role into business advisor rather than a mere salesman. In short, the program focuses on business building as a whole rather than a propaganda forum for selling cigarettes. PTC stresses the importance of expanding customer base through good service and the removal of counterfeit cigarettes from the market. Overall, the key goal is not to deceive a trusted consumer for short-term goals.

2.4.1 SWOT Analysis

Strengths Continuous learning and improvement. Sustainable growth. Page | 24

Environmental standards achievement. Market leadership in the world. Being beneficial to the community (Corporate Social Responsibility) Diversified workforce and environment. Technologically advanced machinery and equipments. Good salaries packages. Focus on health and safety on the company premises. Training and development of its employees.

Weakness Salaries difference between workers who work more and the one who put minimum efforts. Technological advancement would decrease the workforce and unemployment will increase. Very minimum marketing as compare to its competitors. Workers are always under threat because of downsizing. Improper distribution of work

Opportunities Greater opportunity of promoting lower brands in rural region. PTC has the potential to further improve the cost reduction method. Create a better work environment in GLT department because of more hazards in this department. Lowering the downsizing will create a good image in the eye of regulatory authorities and government. Focus on its key brands i.e. high growth like Gold Flack this years growth was around 27%. Export of premium brands

Threats Some of its competitors are also producing high quality brands like Marlboro by Lackson.

Page | 25

Internationally some countries are continuously promoting anti-smoking slogans like the ban of smoking in Bhutan in 2002. Better marketing campaigns by rivals. Their well-established brands are highly copied by some local manufacturer. The political, economic situation is not stable in Pakistan. Limitation of their product, Decline in tobacco growth

3 Environmental Analysis
3.1 Industry and Market Analysis
3.1.1 Product line of PTC
The PTC have a stretched product line covered every segment but comparative to its competitor its lower segment is very short. PTC generates most of its revenue from middle slap. The following are the product line segmented into upper slap, middle slap, and lower slap.

Page | 26

Upper slap
Dunhill 20HL / 10 HL Dunhill Lights Benson & Hedges 20HL / 10 HL Benson & Hedges light Gold leaf 20HL / 10 HL Gold leaf flavor

Middle Slap
Capstan by Pall Mall 20HL / 10 HL Gold flake 20HL Wills kings 20HL

Lower Slap
Embassy kings 20HL

The cigarettes are packed in two different style boxes. They are called Soft cup (SS), Henge led (HL). The interesting thing is that the different plants are installed for the both style packing. Soft cup is imported while Henge led is made in the factory.

3.1.2 Growth rate of entire industry

According to PTC Market Research Department the total market is expanding at approximately 1% per annum. The overall market volume is expected to increase in line with current trends during the next 12 months.

Statistical information in volume

Regions

USA Asia Pacific Latin America

Total market in Billion () 2007 2008 20.1 20.2 74.4 74 76.5 71.4

%age Change

+1 +3 -4 Page | 27

Europe Africa and middle east

Total

114.6 46.6 333.7

116.5 49.1 329.7

+2 +5 +1

3.2 Competitor analysis

3.2.1 Major Competitors
Lackson Tobacco Company (LTC) LTC is PTCs largest competitor and the second legal cigarette manufacturer in the Pakistan besides PTC. Marlboro and Red & White are a few of its brands. LTC used to be affiliated with Phillip Morris, the giant in the global cigarette market; however, this association was dissolved few years ago. Its market share is actually greater than PTC, around 46.2%. The main goal of LTC is money making and it believes in short-term gains rather than long-term benefits. Surprisingly, LTC uses quite unethical marketing strategies for example a number of under-the-table deals are made with the retailers to convince them to take off PTCs merchandize from their store, and to accept LTCs merchandize. This obviously results in a huge loss to PTC as it costs around Rs. 100 000 to fully merchandize a small shop. Mardanwallas These brands are manufactured in Mardan and thus are called the Mardanwallas. These are normally low category cigarettes (under Rs. 10) for example Gold Street. The goal of Mardanwallas is solely money making, and are not concerned about acquiring a strong position in the market. These are also 100% tax evaded. The government has made legislation regarding this issue; however, nothing has been done so far. Secondly, their factories are located in the northern areas so tax evasion becomes very easy. No proper marketing structure or strategies exist for these brands. Their ATL activities, which include electronic and print media, are extremely low. activities, which mainly consist of posters. Counter fit / other Tax Evaded Brands Counterfeit brands emerge as a threat for PTC, and later become competition as well. In Pakistan, the concept of copyright laws and its implications is almost non-existent. As a Page | 28 These brands usually survive on BTL

result, these brands are manufactured without any fear.

As a result, PTC has

suffered a huge loss in the recent years as its premium brand Gold Leaf, has been copied in three different qualities with three different prices for each. These brands are normally sold in thickly populated villages to uneducated and low-income people, and at interchanges and motorways. There are also other tax evaded that is smuggled brands in the market. These are called ITBs (International Transit Brands). These are usually smuggled from Peshawar through Afghanistan or Dubai.

3.2.2 Market Shares:

Market Share of PTC and its Competitors Pakistan Tobacco Lackson Tobacco Mardanwalls Counterfeit/other Tax evaded brands 45.70% 44.20% 2.20% 1.8% 5.90%

3.2.3 Goals
To regain volume and value leadership by positioning viable brands in all consumer related segments of the market. The focus is on the light segment, ASU 30(adult smokers under 30 years), and premier brands. To drive world class standards in products process and services through passionate skilled and confident people To meet stake holders expectations To be seen as a responsible company in a controversial industry. Establish a focused segment and differentiated brand portfolio Create a winning cooperate culture which focus on vision, mission and values. Restructure PTC cost bases to become competitive locally and globally

To meet these objectives, PTC is taking the following initiatives:

3.2.4 Competitive Strategies

Page | 29

3.2.4.1 Corporate strategy Good corporate strategy Responsible product stewardship Mutual benefit

3.2.4.2 Operating Strategy The operations strategy of PTC is Our strategy reflects our vision of being the champions of growth, productivity, responsibility and a winning organization.

3.2.4.3 Core Competencies Following are the core competencies: Quality Cost Delivery speed Flexibility (in terms of volume)

6.2.4.4 Flow strategy Fixed flow strategy is used in the marketing process, as the market is done for Make to stock. The strategy is fixed because only one product i.e. cigarette is produced. The brands of cigarette are different depending upon the type of tobacco used.

Trade Marketing and Distribution Structure

Page | 30

TM&D Structure. North region.

Mr. Imran anj um Regional Manger Islam abad AM Amin Piracha Rawalpindi AM Raja S aeed Pesh awar AM Ali Changazi Sargodha AM Jhelum AM Shaher yar Khurram Imran Faz al RO Support Staff

Ali Lodhi Islamabad TMO

Y asir Abbas Rawalpindi TMO

Arshad Hayat Peshawar TMO

Gulfraz Khan Jhelum TMO

S ajjad Shah Sargodha TMO

Ali Raza Admin Officer

Kamran Shahzad W ah TMO Muhammad Munsif Abbotabad TMO

Usman Saif Guj ar Khan TMO

Shah Hussain Mingora TMO

Riz wan Ul Haq Guj rat TMO

Sheraz Abbasir Mianwali Section

Data Analyst Ameer Hamz a

S ajjad Sabir Chakwal TMO

Khurram Dilshad D.I Khan TMO

Raj a Bishrat Mandi TMO

Ashfaq Ahmed Khushab Section

MC Shahid Akhter

Afz al Hussain Muzaffarabad TMO

Zahid Akhter KotliTMO

Amanullah Jan Kohat TMO

Tauseef Hassan MirPur TMO

Raj a Khalid Bhalwal Section

CF Accountant Malik Zubair

Hassan Najan Channel Manager Tariq Aziz Key A/C TMO Nadia Willam KEY A/C TMO

S PC

Distribution in Islamabad

Islamabad Market

Page | 31

Population: Cigarette Industry: Market Growth: BAT Volumes & Share: LTC Volumes & Share: Others Volumes & Share:

950,000 - 90% Salaried Class 74.1 Mn SticksMarket. 3.5% SPLY 34.5 Mn Sticks 29.9 Mn Sticks 9.0 Mn Sticks 47.5% 40.0% 12.5%

Distribution Chart

M. Asif Proprietor

KPO

Dist Manager

Office Manager

2 FSOs

11 DD Salesmen

5 VDD Salesmen

Distributor Operations
It primly covers the following area: 1. effective Sale and distributions of Brand portfolio as per company into VDD, DSD and wholesale segment 2. Training and development of sales force. 3. Identification of potential areas in consultant with area team. 4. Maintain the documents as per company guideline. Page | 32

Distributors channel

Distributor

DSD Direct Sale Delivery VDSD Village DSD Shop sale

Village wholesale

Main town Whole sale

Sales
I. Primary sales: The total stocks dispatched from warehouse or directly from the factory to particular area are known as primary sales of that area. II. Secondary sales: The total stock sold by the distributor of that area to retail and whole sale market is known as secondary sales of that area. III. Consumer off-take: The consumer off-take is the sales being done by retailer to the end consumer. Page | 33

Operations
1. Effective sale and distribution: To achieve effective sale and distribution TMO works in conjunction with distributor in identifying new beats and potential areas. In this regard, this dept. evaluates whether the current sale force is sufficient enough to provide the potential exist in the mkt. Based on their assessment, if required, The company can ask their distributor to increase the sale staff. Since the distribution evaluation is a regular feature, inputs are taken considering distributors ROI to provide sale subsidy in the form of sales staff salary. Besides, distributor at irregular intervals himself visits his mkt. to access brand availability, competitors sales, and potential new customer based mkt. trends. Salesmen are provided sales target for the month that it further reviewed by FSO. 2. Training and Development of Sales Force record : To gain maximum dispersion into the market the , the right sale force is the key. Whenever a salesman is hired he is put through one week On-The-Job training program with experienced salesman of the mkt. Distributor should discuss the nature of job , salary, commission, attendance allowed and targets of the company. 3. Identification of the potential areas: Tobacco market in Pakistan is highly scattered with numbers of outlets increasing every year. According to the last RCS in 1997-98 number of outlets in retail universe was 247000 that has increase to more than 300000 by now. To identify these potential areas, distributor works with TMOs of the market. 4. Maintenance of all documents as per Company guidelines: PTC has devised and developed various documents for sufficient level of control over secondary supply chain. Distributor staff up date these accounts on routine basis as per prescribed by the company. These documents are listed below;

Page | 34

Document name Lifting plan OCF SD20 SD9 Distributors DSR Monthly Sales Report Stock Issue Register Cash Memo Fixed Sale Summary DSD Contact Claim Register

Owner Distributor Distributor Distributors Clerk TMO Distributors KPO Distributors KPO Distributors Clerk Salesmen Salesmen/FSO supervision Salesmen Distributors clerk

Update frequency Monthly 10Days Daily Monthly/Quarterly Daily Monthly Daily Daily Daily Daily when required

General Term used in PTC:

a) Lifting Plan: It is date wise stock shipment to be received by the distributor from company warehouse. Based on marketing trends, Promotional plans and on hand stock, distributor provides lifting to both distribution department and factory warehouse on monthly basis. b) OCF (Order control Form): This document is generated after every 10 days each month as under: 1-10 days 2-20 days 3- End of month. This document provides distributors 10 days requirement of each and every stock keeping unit against the ECD define by the relevant TMO of the market.+

Page | 35

c) segments;

SD-20:

It provides the detail of daily stock keeping unit wise secondary sale in the following trades DD: Direct delivery by the salesmen to urban area of the market. Shop sale: Retailer or shopkeeper sometimes visits at his own to VDD: village direct delivery, secondary sales to village outlets by the Whole sale: secondary sales to wholesaler in market.

distributor shop so such sales by the distributor are shop sale. salesmen is termed as VDD. d) SD-9 : This register is also termed as Distributor Statistics Register because the complete details of distributor working and setups are in it. Firstly the total number of universe classification of outlets are printed on it and from them how much he covering. secondly the total picture of his urban and village profiles is printed with respect to its volume classes (1-9) and in last the total sales for each own and competition brand are written and the total share of companies are calculated .This is considered the back bone or myth of distribution. e) DSR:

DSR is generated on daily basis by Salesmen and checked by the FSO and from this report the SD20 is filled on the start of very next day. In this report the total and brand wise sales of each day is punched and it must meet with the closing balance of each brand of last day. It consists: f) ECD Stock Received Closing stock Sales Monthly sales Report:

It provide Stock Keeping Unit secondary sales in DD, VDD, Whole sale and the shop sale per month with break up on 10-days basis. Additionally it also provides information about the

Page | 36

stock received during the month, to-date for the year, sales same month last year and stock on hand position.

g) Stock Issue Register: It provides information as under: h) Cash Memo: Whenever any outlet owner purchases stock from distributor salesmen, he hands over a slip containing stock rates and value and name of shop with distributors name book called as Cash Memo. i) Fixed Sale summary: It provides salesmen daily productivity or sale from shops. It covers following information: performance directly. j) DSD contact: Salesmen who mention over all market scenario in his beat during the day file this report. Salesmen describe the statement of non-handlers of PTC and their views. Total number of outlets per beat. Outlets covered. Productive outlets. SKU wise stock taken by salesmen for his beat. Stock returned at the end of the day. Rate of SKU. Value of stock sold.

All salesmen are sorted against their relevant FSO. Report also provide the FSOs

k) Claim register:

Page | 37

This register is maintained by distributor to keep track of promotional D&D claims. Whenever these claims are approved by the AM/RM an amount of such claims are transferred into the distributors account.

4 Task 1
4.1 Role profile of the FSO
4.1.1 Introduction
My first task is to revise and Implement the role profile of FSO, working at distributor shop. The previous role profile is vague and some working terms and conditions are not applicable in these days. Most impotently our FSO did not follow that profile in their daily routine. Being kept in mind this situation I started my work on this project and collected all necessary information. In this project Mr. Ali Lodhi (TMO) and Mr. Qadir (FSO) helped me and tell me about his (FSO) Do's and Donts, his duties, liabilities and rights, what he should follow and what he should not. For the completion this task I had a time period of 10 days, In first five days I gathered all the necessary information from FSO at the distributor shop. My target is to develop a profile that helps the FSO in his daily routine which means to develop a check list for FSO. Ali Lodhi checked that information and added some important points in it. After getting all the points I edited them and made three copies, sent one copy to Area manager Islamabad, second to regarding TMO and third to FSO at distributor shop.

4.1.1.1 Main Points in FSO RP 1. Check and maintain DSR. 2. Check the availability of Company stock in Market. 3. Provide help to salesmen through regular and accurate communication. 4. Management of salesmen. 5. To check records and assist the salesmen in stock management and sales (in the event of

any promotional activity).

Page | 38

6.

If there is any problem with the salesmen issue he should find remedy and

also able to address local issues. 7. 8. 9. Maintain good working relationship with the company staff, salesmen and distributor. He should pay surprise visit to outlets, which creates moral check on salesmen. If any salesman is absent he should maintain the records of absentees and make sure

Spare salesmen provide the stock to outlets under that salesman. In our previous role profile the training program was not up to Date and applicable. Now we have added a new training program which is known as 9 steps of Sales Call. Now his main task is checking the DSR daily so the problem of Missing DSRs should solve.

4.1.2 Findings

fter visiting the distributor there are some Findings in my point of view which I have listed below:

1. DSRs are missing. 2. No accountability, one can not hold anyone responsible for wrong data entry. 3. Lack of resources needed to carry out day to day activities. 4. Lack of interest and concentration during record maintenance. 5. No record is maintained for absent Salesmen. 6. The use of different Cash memo books for maintaining a single months record. 7. Documentation is very poor and need further improvement.

Page | 39

8. FSO did no follow his role profile and RP should be revised. 9. Salesmen Beat and route plan should be revised. 10. RCS numbers are not updated.

4.1.3 Recommendations
1. Mr. Asif should arrange a small training session for its supervisor. In this training session the supervisor would be given the basic training to use Microsoft office suite. This training should be on the job training because this would enable the keypunch operator to learn quicker and I think a 3 day training would be enough. 2. Single cash memo book should be used during month and record should be maintained on issuance of cash memo book. So if DSR are missing for any reason one could check the Cash memo books. 3. To deal with the problem of not preparing the daily DSRs, Mr. Asif should himself address his salesmen about the importance of DSRs. He should also tell them that its not something extra for you people but it is something which is a part of your daily work. 4. FSO of that distributor shop should maintain the record of absent Salesmen and if any replacement is made then he should check the DSR of that day. 5. Salesmen and FSOs should take interest in their work. Its the duty of Mr. Asif to provide them healthy and friendly environment so they complete their work efficiently and on time. 6. Mr. Asif should appoint an employee to maintain the DSRs electronically so that errors and frauds are minimized.

Page | 40

7. If the above recommendation is applied then the person who is employed should also check the Record of cash memo books, so the problem of missing DSRs and cash memos should be solved. 8. FSO role profile should be revised because some term and conditions are vague and up to date. 9. Salesmen beat and route plan is too old and some times SM miss important shops due to there route. So it must be revised.

4.1.4 Conclusion
In Islamabad area the distribution ship is excellent and the sales are above their target but the documentation need further improvement, to cover this slur we appointed a new employee, whose main work is to generate electronic DSRs and maintain the record of Cash memo books issued to salesmen. Mr. Asif himself is very nice and polite in nature but he lacks good management skills. Its his duty to check whether the staff maintains the record or not. If any of the staff members is deceiving him then he should take some immediate action against him.

4.1.5 Results
After the completion of Role profile of the FSO we implemented that profile and the results are excellent. FSO is taking interest in his work and DSRs are regularly checked. Now our distributor Mr. Asif also taking interest about DSR and their maintenance. this role profile also creates a healthy relation between distributor and FSO.

Page | 41

Task 2:
4.2 Salesmen beat revision

4.2.1 Introduction
It is the duty of Salesmen at Islamabad distributor Asif & company to visit their regarding outlets and provide them stock on their purchase frequency dates. But some time they miss their shop/outlet because of their route plan which causes a communication and demand gap between the salesmen and Retailer, so to over come this problem I had done several meetings with salesmen to hear their views about this problem. After every meeting I concluded that there is only one solution and that is BEAT REVISION. So, keeping their view in my mind I started my work on salesmen beat revision plan. With the help of previous rout plans and information provided to me by salesmen I drew a new format with a more consolidated rout plan.

4.2.1.1 Results
Beat rout plan is now drawn according to their journey cycle. With the help of this plan they will never miss their outlets and the numbers of complaints will be minimized.

4.2.2 DSR Problems

In addition to all this work I had also changed the format of Daily Sales Report (DSR). As mentioned above in the findings that some times DSRs are missing due to some lame reason. If we ask about the missing DSRs from salesmen they tell us that we forget to make DSR and drew a bill on Cash memo. But there is another Problem, they use new Cash memo book daily. So finding a bill and DSR is very difficult.

4.2.3 Solution
To over come this problem we introduced a new column in DSR that is Cash memo bill number i.e. C.M.no. It helps to minimize this problem. Now it is the duty of every salesman to write cash memo number in front of the outlet name which he visits. With this method the daily usage of new cash memo book is stopped and the problem of missing DSRs will be solved. They will have to show there previous book for the Page | 42

issuance of a new book. This step led to prevent the errors and reduce the overheads of the Distributor.

4.2.4 Beat updating

Another task assigned to me was beat updating. After completing the beat revision it is necessary to update them. For this purpose I had discussion with Salesmen and convinced them to make a list of the Close and newly open outlets. For this task I had a time period of 5 days. On the second day salesmen gave me the list and I appoint Mr. Naveed (working as data operator) to up date the beat list. Close shops/outlets are eliminated from the list and new shop/outlets are entered.

4.2.4.1 Results After updating the beats there is less chance of errors and fictitious sales are minimized. Now salesmen have less than 55 outlets in their beats & rout plan and they visit them daily. It will also help to increase the sales and distribution in that area.

4.3 RCS updating

RCS stands for Retail Censes Survey. Every outlet in an Area has its specific RCS number which show its Daily and weekly demand and Sales, merchandizing as well as its weekly holiday and shop closing time. Some new outlets in Islamabad area are not registered or you can say their RCS number is not generated and assigned to them. Mr. Ali Lodhi who is the TMO at Asif & company helped me to up date that information which is very helpful for Distributor and Company as well. In very few days we completed all our paper work and assigned a person to up date that information. RCS is basically a format which shows the information about shop and its scale. This information helps TMOs and other company officials to know the current status of that outlet. I also attached the format with this report.

4.3.1 Result
If RCS survey is complete in a manner that each and every clause is vivid and clear then it will help the company to generate authentic reports and market survey. After all, all

Page | 43

promotions are based on data provided by the trade. Therefore it is necessary to have the right data. It helps to improve the efficiency of company.

4.4 Key accounts Management

Key accounts include those shops/outlets on which the sales of our premium brand like Dunhill and B&H is more then 30% of its daily avg. sales. There are total 250 outlets declared as key account outlets in twin cities. In Islamabad area there are 130 outlets declared as key account outlets. There is a separate manager appointed as channel manager to deal these outlets. In North region Mr. Hassan Najam is Channel manager. There are two separate TMOs for this field. Nadia William and Tariq Aziz appointed to manage these outlets.

Page | 44

Appendix
Role Profile
Job Title: Field Supervisor officer (F.S.O). Reports to: Trade marketing officer (TMO). Function: Check Distribution/ Availability of stock. Appointed by: Distributor. Location: Islamabad. Purpose Statement: To have a complete moral Check on FSO to raise the bar of sales and increase the efficiency of Distribution in Islamabad area and to achieve distribution targets in order to maximize brand availability and visibility in outlets and required customer service level. Principles/ Duties of FSO: Ensure that Company stock is available in market. Achieve Distribution coverage; visit outlets frequently in order to maximize the sales and Ensure stock level, product quality and freshness through stock management and write Actively Participate in Trade & consumer promotions. Display company brand in order to maximize brand awareness & visibility. Provide help to salesmen through regular and accurate communication. Page | 45

route effectiveness. report on product issue.

Provide information about the competition in market and report to ensure that He should check daily sales report (DSR) whether it is generated daily or not, if not then Check his salesmen work whether he is working properly or not. To check records and assist the salesmen in stock management and sales (in the event of If there is any problem with the salesmen issue he should find remedy and also able to Maintain good working relationship with the company staff, salesmen and distributor. He should pay surprise visit outlets to create moral check on salesmen. If any salesmen is absent he should maintain the records of absentees and make sure the

the consumers are fully aware. what is the reason behind this.

any promotional activity). address local issues.

delivery of stock to outlets under that salesman

Additional Information
The Distributor appoints FSO. His main task is to check and provide stock in outlets. It is his duty to check the daily sales report (DSR) generated by salesmen if any DSR is missing He should enquire about it. The role of the FSO is to manage the territory in order to achieve the Distribution targets and promotional plans within the area.

Training Program
The main training program available to support the FSO function is: 1: Nine steps of sales call.

Knowledge
He should know about Market, Product, availability of stock in market and use of Microsoft Windows and MS office.

Skills
A good FSO should have following skills Communication, Negotiation, selling Plans, Ability to build and maintain customers relationships. Page | 46

Personality
Self motivated Team player and high standard of presentation and personality.

Key success Factors

Achievement of Sales and promotional targets assigned by the Distributor in regarding area. Achievement of territory coverage targets. Providing friendly environment to salesmen so they meet their territory targets.

Relationship: The principle focus will be on the establishment of a close working relationship with the Traders, retailers and the final consumers.

PTC Brands

Page | 47

Page | 48